Top 20 Oil & Gas Interview Questions & Answers

What are the different types of oil found around the world?

There are about 161 different types of Oil in the world. Oil is classified into different types of crude oil such as Brent, Dubai Crude, West Texas, Intermediate, etc. Based on their sulphur content.

2) What is OPEC?

OPEC stands for Organization of Petroleum Exporting Countries.

What is the purpose of OPEC?

They are a group of countries that produce crude oil and were founded in 1960, in order to regulate the export of their crude oil to other countries and to determine the price of crude oil. OPEC’s 12 member countries supply about 40% of the world’s oil.

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4) Who are the current members of OPEC?

• Iran

• Iraq

• Kuwait

• Venezuela

• Saudi Arabia

• Qatar

• Indonesia

• Libya

• U A E

• Algeria

• Nigeria

• Angola

5) What factors are considered in determining the price of crude oil?

Crude oil is a commodity, and its price is determined by supply and demand.

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6) Who controls or decides the price of oil?

OPEC does not set crude oil prices, but it influences market prices. Global crude oil prices are determined by the exchange market.

New York Mercantile Exchange (NYMEX)

 International Petroleum Exchange in London (IPE)

Singapore International Monetary Exchange (SIMEX)

7) How U.S dollar contribute to the rising Oil prices?

On the world market, oil is priced in U.S dollars. So, when dollar becomes weaker, foreign currency becomes stronger, which means foreign countries can buy more oil at same amount of money. As people in other countries start buying more, demand rises, and it drives up the price in dollars, which again influence the price of oil in the global market.

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8) Explain how much do you pay for a gallon of regular gasoline?

On a regular gallon of gasoline, you will pay about

• Crude Oil: About 67% of what you pay goes to the cost of crude oil

• Refining costs and profits: About 14%

• Distribution, Marketing and Retail costs and profits: 8%

• Taxes: 12%

9) Mention what is the amount of ethanol present in gasoline?

Approximately about 10% -15 % of ethanol is present per gallon of gasoline, and it is denoted by E10.

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10) Explain what is PowerShares DB Energy Fund?

In the energy commodities, this fund is the most rounded investment in the energy commodities. This fund is invested in the energy futures contract like heating oil, Brent crude oil, RBOB gasoline and natural gas.

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11) What are the factors that decide the retail price of Gasoline?

The gasoline retail price is determined by following factors

• Transportation costs

• Location (Urban/ Rural)

• Average volume pumped

• Competitive mix ( Concentration of major oil companies and independent marketers)

12) What are the taxes you have to pay on your gasoline?

There are State taxes and Federal taxes that is levied on your gasoline, though taxes changes from one state to another. You are paying approx. 23% of state taxes per gallon of your gasoline that may vary to 40% depending upon the state. While, federal government excise tax is about 18 percent per gallon.

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13) Mention what are the factors that can fluctuate in gasoline price?

The factors that can fluctuate the gasoline price are

• Changes to the price of crude oil

• Major supply disruption in any area of the country

• Increased consumer demand

• Expected or unexpected outages of any refinery

• Activity on the commodities market

14) Who analyse and does research of the Oil and Natural gas supply in U.S?

EIA (Energy Information Administration) is an independent agency of the United States Department of Energy, which gives all the weekly detail or data of the supply of oil and natural gas in U.S. It schedules weekly publications known as WEEKLY PETROLEUM STATUS REPORT and THE WEEK IN PETROLEUM.

15) Explain how many gallons of gasoline does one barrel of oil can be made?

From one barrel (42 gallons) U. S refineries make about 19 gallons of motor gasoline. The residue yields other refined products such as distillate and residual fuel oil.

16) Which states have the highest gasoline prices?

The states that pay more for gasoline than other states are:

• California

• New York

• Alaska

• Connecticut

• Michigan

• Pennsylvania

• Indiana

• Maine

17) Explain how much do oil companies make on each dollar you spend on gas?

Oil and natural gas industry make 8.6% for every dollar of sales.

18) Mention what are the requirements for importing natural gas, oil and petroleum into the U.S?

For importing petroleum or petroleum products to U.S, you don’t need a license to import these items, but you need to file a form called EIA814 with the EIA (Energy Information Administration).

19) What is API gravity?

API means American Petroleum Institute; it is the main association for the oil and natural gas industry in U.S. The API denotes about 400 corporations in the petroleum industry and helps to set the standard for production, refinement and distribution of petroleum product.

20) How API is calculated?

API is nothing but the ratio of its density compare to other substance like water to check the standard of the oil. The formula to check API is

API gravity = (141.5/ Specific Gravity) – 131.5

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